Department store chain House of Fraser has sold a majority stake in its business to Chinese conglomerate Sanpower in a deal worth £480 million.

The non-state owned Chinese giant, which is listed on the Shanghai Stock Exchange, acquired an 89% stake in the 165-year-old brand's UK and Ireland department stores through its Nanjing Cenbest subsidiary.

The deal has been touted as the largest overseas acquisition ever in the retail sector by a Chinese business, with Sanpower now expected to develop the brand overseas.

Its announcement comes after reports last week that Sports Direct tycoon Mike Ashley had bought an 11% stake in the business in an attempt to derail the deal with the Chinese.

But House of Fraser stressed yesterday that, should that transfer of shares go through, the Newcastle United owner - whose interest in House of Fraser has been known since 2012 - would not have the right to a position on the company's board.

The company, which went private in 2006, also said it did not expect to see any day-to-day changes for the 7,300 House of Fraser staff and 12,000 concession employees working across its 60 stores.

Hailing the announcement Don McCarthy, executive chairman of House of Fraser, said it opened an "extremely exciting chapter in the story of House of Fraser".

He added: "The acquisition by Nanjing Cenbest will allow House of Fraser's management team to continue to grow and invest in the business in the UK and Ireland, provide a strong platform from which to expand the brand in international markets and to further develop our multichannel, stores and premium fashion offering.

"I am extremely confident that the Group's business model, with our premium brand positioning and strong multichannel operations, as well as international opportunities, will accelerate and develop long into the future."

Sanpower, which was ranked 24th among the 500 non-state owned enterprises in China by the All-China Federation of Industry and Commerce last year, described the move as "a landmark transaction for a Chinese listed company".

The Nanjing-based group's founder and chairman, Yuan Yafei, said the deal was "the largest cross-border direct acquisition by a Chinese non-state-owned A-share listed company, and the largest overseas acquisition in the retail sector by a Chinese business".

Mr Yuan added that Sanpower now plans to develop House of Fraser's business and replicate its model in international markets, especially in China.

The 49-year-old said: "House of Fraser is a strong and iconic heritage brand in the UK and abroad, with exceptional fashion credentials.

"The management team has done an incredible job moving this business from a traditional department store to a recognised premium branded fashion retailer with a first-class multichannel offering.

"We have always been looking to invest in strong brands like House of Fraser, and take them to the next level of growth."

Commenting on the effect the acquisition would have for employees, a House of Fraser spokeswoman said: "This is about growing and investing in the UK and Ireland business and also abroad, so any impact will be positive.

"The Chinese have made it clear that they are 100% behind the UK growth story, so it's all about what we can do both here and internationally."